Stocks mixed, oil drops ahead of Ukraine talks

This week, investors will also be watching Japanese inflation data for guidance on whether the Bank of Japan will hike rates again this year.

Stocks opened on a cautious note as investors looked to Donald Trump’s talks with Ukrainian President Volodymyr Zelenskiy for direction before adding exposure.

Shares in Japan and Australia rose while futures for the US and European stocks edged up 0.2%. WTI crude dipped 0.4% as the US-Russia summit ended Friday without any geopolitical escalation, easing concerns of supply disruption.

A gauge of the dollar was little changed. Treasuries inched higher with the yield on the 10-year declining almost one basis point to 4.31%.

Investors will turn their attention to the Trump-Zelenskiy talks in Washington for clues on where the markets head next after the US-Russia summit ended without any new sanctions on Russia or buyers of its crude. Traders are also staying cautious ahead of the Federal Reserve’s annual retreat at Jackson Hole with Chairman Jerome Powell’s speech keenly watched for guidance on a September interest-rate cut after recent US data.

With expectations already low heading into the Trump-Putin summit, market reaction is likely to be mild “as a lot still rests on Ukraine’s willingness to accept the terms from Russia,” said Jordan Rochester, head of macro strategy for EMEA at Mizuho Corp. “But hope is a powerful thing and this outcome will keep the slow grind of higher risk sentiment alive and well.”

Zelenskiy and his European allies arrive in Washington on Monday anxious to find out what Trump committed to at his summit with Putin and apprehensive that he’ll force Kyiv into making unpalatable concessions.

While the US is expected to focus on territorial concessions demanded by Russia, Kyiv will seek to pin down possible security guarantees, according to a person familiar with the matter.

“Market expectations for anything tangible that would constitute a positive surprise remain low,” wrote Chris Weston, head of research at Pepperstone Group in Melbourne.

The end result from Friday’s summit is more of the same, as stakeholders look for next steps in resolving the crisis, said Helima Croft, head of commodity strategy at RBC Capital Markets LLC. Attention now may shift back to India and China as the US tries to look for ways to further crimp the Kremlin’s oil revenues.

“Trump appears to be putting on hold any additional sanctions or secondary tariffs on energy,” Croft said.

On Friday, Wall Street traders sent stocks down from all-time highs as data showed mixed indications on how American consumers are feeling about the economy.

This week, investors will also be watching Japanese inflation data for guidance on whether the Bank of Japan will hike rates again this year. China’s loan prime rates will also be in focus amid expectations of more stimulus from Beijing to weather Trump’s trade war.